With Tuesday’s release of USDA’s latest World Agricultural Supply and Demand Estimates, National Corn Growers Association officials admit there's is reason to be concerned about the weather’s impact on the corn crop. However, NCGA is still confident that growers can still produce an adequate crop.
“Thanks to a very successful 2007, we started this year off with a significant level of beginning stocks that can help see us through a season of reduced production,” says Ron Litterer, NCGA president and grower from Greene, Iowa.
In its report, USDA increased its projection of carry-out from the current crop marketing year to 1.433 billion bushels, based on reduced exports this year. While the planted and harvested acre projection remains the same as the May report, the yield estimate was reduced by 5 bushels an acre due to “slow planting progress, slow crop emergence, and persistent, heavy rainfall across the Corn Belt.”
While the United States won't actually "run out of corn," the issue is what price will the supply demand? With current prices beyond $6 per bushel, $8 per bushel seems likely, if not modest. Also, U.S. corn exports are moving well, and there's no indication that tide will shift.
"We're no longer in a position where one good crop will recover the corn supply," notes Glenn Grimes, University of Missouri agricultural economist.
To view USDA’s World Agricultural Supply and Demand Estimates, click here (PDF format).